Archive for October 30, 2007

Wow. No journalists in the media currently reporting on the Home Builder industry / Housing market seem to be explaining exactly what is going on. They keep blaming it all on the same culprits, from Credit woes to energy prices. While they are correct, there is much more to the story.

As an efficiency expert, I will try and give you some deeper insight into some root causes of the housing implosion. Let’s first start out with the see-saw reporting in the media:

Here is a report from October 26th:

‘Acknowledging that there is definitely downward momentum in the market at this time, with starts, sales, prices and permits off, and problems in the subprime and Alt-A mortgage markets, NAHB Chief Economist David Seiders said that housing should nevertheless begin a modest recovery next year.’Source: NAHB

Reality, however, keeps on rearing it’s ugly head more and more every day. This new Housing report just came off the presses:

NEW YORK – U.S. home prices fell nationwide in August for the eighth consecutive month, offering little hope of a turnaround anytime soon, according to the S&P/Case-Shiller index released Tuesday. Things could get worse, said Yale economist Robert Shiller, who helped create the index.

“There is really no positive news in today’s report,” said Shiller, chief economist for MacroMarkets LLC, which collaborates with S&P on the indicator. “At both the national and metro area levels, the fall in home prices is showing no real signs of a slowdown or turnaround.” Source: MSNBC

Hrmmmmmmmmmmmm. Anyone know when the housing market will recover, if ever? Bueller? Bueller?

There are so many variables that are being left out of these stories, journalists obviously don’t know the whole story. Sure, they know simple facts like how America’s homes gobble up 25 percent of the world’s energy and are to thank for 19 percent of global greenhouse gas emissions.

Home Builders are following the same logic they have in the past to try and fix their present problems. Right now, one of their solutions is to fire the present line of market managers in the hopes that reorganizing the company will fix things. You know, give those eager up-and-coming managers a chance at the reigns. Perhaps the advertising campaigns will be switched up, and more special pricing packages will be created.

These fixes will only work for so long.

This slump is not just about home sales and management shuffles! It’s about operational efficiencies, or rather inefficiencies of the home builder market that need to be examined. I’m not just talking about higher efficiency Energy Star certifications on fridges, microwaves, air conditioning units, heating systems and dishwashers here. You have to dig deeper.

So, all you Home Builder management types, listen up!

I know you are losing millions of dollars to theft of new appliances in freshly built homes. I know that in all likelihood, it’s an inside swindle being pulled on you by contractors, not ordinary thieves kicking in doors or breaking windows.

I know you are paying increased security costs to try and stem the losses from having to buy the same new appliances twice.

I know you are losing sales to people foregoing their deposit to re-purchase the house at a lower price as the market value of homes drops.

I know you spend a lot of money on advertising that goes to waste.

There are, of course, many more points I can nitpick at. But if you want to stop the bleeding and start making sales again, you are going to have to start paying attention and listening to experts like me that can help you return to better profitability.

There are solutions ready to go. Here’s just one idea for you, free of charge:

When one alarm goes off in the neighborhood, or a crime occurs and a neighbor wants to report it – have an opt-in neighborhood alert system set up. Every person in your branded DR Horton, Arbor , or (insert your company name here) community can become eyes and ears.

My company is called Bright Neighbor, and we have created the all-in-one tool to help secure your profits, communities, and sanity. Our solution is affordable, and will help you save millions of dollars right away.